The leadership was also embroiled in a row over blocking debate on a motion criticising the coalition's economic strategy.

The session in Brighton got off to a rocky start when Mr Clegg accidentally referred to the "good work Ed Balls is doing", when he meant to praise Energy Secretary Ed Davey. He then inadvertently suggested that Business Secretary Vince Cable was among "millionaire" pensioners who should be stripped of free bus passes.

The atmosphere became more heated when activists began to challenge Mr Clegg over the Justice and Security Bill, which would allow courts to sit in secret in some civil cases. The legislation was comfortably given its third reading in the Commons last week, despite a rebellion from some Tories and Lib Dem MPs and continuing opposition from civil rights campaigners.

One Lib Dem member questioned why Mr Clegg had "abandoned the high ground" by engaging with the proposals. And another said: "How can we call ourselves a Liberal Democratic party any more if we vote for this legislation?"

However, the party leader said the intelligence services were currently unable to defend themselves in some civil court cases because they could not disclose sensitive material. He stressed that many changes had already been made to the original proposals, and said he was unable to do what activists wanted and block the measures because only 8% of MPs were Lib Dems.

Mr Clegg received strong applause from most of the audience when he said the party had achieved a great deal given its presence in Parliament. And there was a warm response when he rebuked Tory Defence Secretary Philip Hammond for seeking more cuts to welfare.

Mr Clegg was also pressed on moves to cap total household benefits at £26,000 per year. The leader insisted that level was equivalent to earning a salary of around £35,000 before tax. He said: "I think most people would think that is a fair rule of thumb."

When chairman Andrew Wiseman said it was time to move on from the benefits topic, one audience member loudly complained that the issue should get a fuller airing. Mr Clegg joked: "The Q&A is turning into a riot."